Japan's Commitment to the Peaceful Use of
Nuclear Energy

As 2003 BEGINS, Japan's power industry continues its efforts
to regain public trust, which has been weakened chiefly as a result
of the Tokyo Electric Power company's (TEPCO's) inappropriate
handling of voluntary inspection records at its nuclear plants.
Nuclear-related laws have been amended, and nuclear utilities
are now required to evaluate and submit records on equipment safety.
The Nuclear & Industrial Safety Agency (NISA) of the Ministry
of Economy, Trade and Industry (METI) plans to issue detailed
evaluation rules, including the application of private sector
standards. To future enhance safety culture, the FEPC, which comprises
10 member electric power companies, will, through evaluation of
member management and operations, strengthen link within the Nuclear
Safety Network (NSnet), which is composed of electricity and research
organizations.

Nuclear Energy and IAEA Safeguards System

The Atomic Energy Basic Law, promulgated in 1955, expressly declares
that Japan shall use nuclear energy only for peaceful purposes.
In order to demonstrate the peaceful nature of Japan's nuclear
energy to the international community, we have accepted an inspection
system involving the application of comprehensive safeguards.
The technical objective of these safeguards, which are applicable
under the treaty on the Non-proliferation of Nuclear Weapons (NPT),
is to detect in a timely manner any diversions of significant
amounts of nuclear material from peaceful nuclear activities to
the production of nuclear weaponry or nuclear devices, or to some
unknown purposes.

In 1970, the NPT came into force, and Japan joined the treaty
in 1976. Article 3 of the NPT requires non-nuclear weapon state
to accept IAEA safeguards. In accordance with this provision,
NPT non-nuclear weapon member countries, including Japan, have
entered into full-scope safeguards agreements with the IAEA. Within
this framework, all nuclear materials at all nuclear installations
in Japan, including nuclear power plants, uranium enrichment plants
and reprocessing facilities, are subject to international safeguards.

In order to ensure the application of more extensive safeguards,
Japan signed the IAEA Additional Protocol in 1998. The Additional
Protocol allows the IAEA to carry out a range of additional measures
to ensure there are no undeclared facilities and activities, thus
conferring very important additional rights of inspection on this
international agency in verifying the use of nuclear energy solely
for peaceful purposes.

In accordance with national laws, Japanese nuclear utilities
and research institutions submit safeguards reports, including
data on material accountancy and activities, to the Minister of
Education, Culture, Sports, Science and Technology. The IAEA and
the Japanese government conduct joint safeguards inspections that
serve to verify the accuracy of these reports. In the process,
the IAEA has the right to independently verify the accuracy of
the information it receives. Japan is estimate to be the subject
of about 20 percent to 30 percent of the IAEA's inspection activities.

Moreover, Japan also has bilateral cooperative agreements on
peaceful uses of nuclear energy with the U.S., the U.K., France,
China, Canada and Australia. Under these agreements, Japan has
agreed to accept various additional non-proliferation conditions
and controls. Additionally, Japan has been a long-time participant
in the Nuclear Suppliers Group that has adopted guidelines designed
to ensure the application of common and effective non-proliferation
conditions to nuclear exports.

Japan not only complies with the IAEA's safeguards system, but
also strives to persuade as many parties to the NPT as possible
to sign the Additional Protocol. Last December, in cooperation
with the IAEA, Japan hosted in Tokyo the International Conference
on Wider Adherence to Strengthened IAEA Safeguards. Attended by
82 participants representing 36 countries, the conference achieved
good results. The international gathering offered excellent opportunities
to encourage other countries to sign the Additional Protocol through
sharing the results of regional seminars held in five countries
since June 2001. In addition, the conference sent the message
to nuclear weapons nations and EU member countries that they were
expected to ratify the Additional Protocol as soon as possible.

Peaceful Nuclear Utilization

While thus consistently ensuring the peaceful use of nuclear
energy, Japan has forged ahead with its nuclear power development.
As a result, a total of 52 commercial nuclear reactors are currently
in operation. Nuclear power generation accounts for 35 percent
of the total power production in Japan.

Japan is poor in natural resources. Domestic oil accounts for
only 0.3 percent of the total crude oil supply and 87.9 percent
of total imported crude oil is supplied from the Middle East.
As an island nation, Japan has not international power transmission
networks resembling those that exist in Europe. In order to enhance
the country's fragile energy security, and from the perspective
of a long-term energy policy, we consider it of the utmost importance
to establish a domestic nuclear fuel cycle and create an independent
fuel supply structure. Therefor, we will continue to promote the
peaceful use of nuclear energy by employing nuclear power generation
and a nuclear fuel cycle that complies with both international
and domestic safeguards systems.